Ponar spreads out
WSE-listed provider of hydraulic solutions Ponar Wadowice will acquire a total of six million shares in FAM Capital Group - amounting to 18.8 percent of its stock - under an agreement signed in December with Mirosław Kalicki, the head of FAM's supervisory board.
Around 2.4 million shares will be purchased for zł.24.96 million in cash, with the remaining 3.6 million to be covered by the issuance of an equal number of Ponar shares at a price of zł.10.40 per share. The more-than-zł.62-million transaction is due to be completed between February and March 2008. The agreement gives Ponar Wadowice the right to appoint the majority of members on FAM's supervisory board and the possibility to consolidate the results of the FAM and Ponar Wadowice groups.
For Ponar Wadowice this is another step towards the creation of an industrial group and the diversification of its activities. FAM Capital Group operates in the construction, furniture and fabrics, steelworks and zinc industries. The zinc industry is especially key for FAM, and Ponar has huge expectations for this branch.
"The [zinc] market is ready for prosperity, which will be driven by the boom in the construction industry and the relative scarcity of zinc in Poland as compared to other countries," said Arkadiusz nieżko, Ponar Wadowice's president. The fact that FAM's revenues have grown four-fold over the last three years is also very attractive for Ponar.
Ponar's plans for 2008 include operational consolidation of its subsidiaries from the hydrolics sector. It also wants to take some of the companies it controls public and intends to complete the takeover of a US hydraulics company in Q1 of this year. Ponar forecast revenues of zł.500 million for 2008.
Tomasz Krukowski, an analyst from brokerage Unicredit CA IB, was cautious in his assessment of Ponar's investment in FAM, however. "An 18-percent stake is too small to exercise control over the company," he told WBJ.
